September 16, 2010

Philip Booth: What ministers should learn from Hayek's The Constitution of Liberty

Professor Philip Booth is Editorial and Programme Director at the Institute of Economic Affairs, which is today releasing a new edition of Hayek’s Constitution of Liberty.

To the socialists of all parties (to whom F. A. Hayek dedicated The Road to Serfdom), The Constitution of Liberty, is anathema. Hayek, they believe, stands for an atomised society full of selfish individuals all looking after their own interests. But nobody who has read the original texts could possibly represent him this way.

One person who understood this was Margaret Thatcher. Once during a party policy meeting a speaker started to argue that the Conservative Party should adopt a pragmatic middle way. According to John Ranelagh in Thatcher’s People, “Before he had finished speaking...the new Party Leader reached into her briefcase and took out a book. It was Friedrich von Hayek’s The Constitution of Liberty. Interrupting, she held the book up for all of us to see. ‘This,’ she said sternly, ‘is what we believe,’ and banged Hayek down on the table.”

It may have been what Mrs. Thatcher believed, but she was in a minority amongst politicians and so there remains much to be done in terms of rolling back the state. Ministers are busy people, of course. But, for the new breed of Whig-minded Conservatives – or, for that matter, Whig-minded Liberals - within the coalition there is now no excuse for not understanding Hayek. The IEA has just published a summarised account of the arguments Hayek made in The Constitution of Liberty: the volume fits neatly into a minister’s red box and can be read in a few hours.

So what is The Constitution of Liberty about? In essence it explains how a complex cooperative, great society can come about in an environment of freedom under the rule of law. It emphasises the importance of tradition and of limiting government discretion. Whilst Hayek might not have been a Conservative, The Constitution of Liberty, to some extent, sits at the juxtaposition of a certain strand of Conservatism and liberalism. Without question it is more “Big Society” than “Big State”. However, the work demonstrates why the Big Society should evolve spontaneously and not be created and cajoled by the government – a lesson not understood by the coalition.

A key argument is that civilisation depends on liberty and that the West has lost its belief in liberty as a guiding principle. Liberty, in turn, depends on the rule of law. But, the rule of law is not the same as enforcing the authority of the law: the rule of law involves, amongst other things, the constraints that we put on the domain of the law and on those who make and enforce the law. Governments must prevent individuals from coercing each other but, if this to be achieved, illegitimate coercion by government must be rejected.

A sophisticated and interconnected social order can then develop. People can make plans and economic and social arrangements knowing that they can achieve their legitimate ends individually and collectively. This is the lesson of economic development in nineteenth century Britain. The big society that existed then was not an accident. It would not have come about had the state used its coercive powers, as it does now, to spend half of national income and to interfere in almost all aspects of economic and social relationships.

But, The Constitution of Liberty is defined as much by what it is against as by what it is for. Though Hayek is keen that government provides social assistance to the poor, he rejects the pursuit of equality as an end in itself as this would destroy society. He is against arbitrary laws, laws that do not apply to all people in the same way and discretionary power. He is against democracy as an absolute value: democracy is a practical way to organise political affairs but, by itself, does not provide protection against creeping tyranny. Finally, Hayek is against “rationalism”. Hayek believes that our ignorance is too great for government to rationally plan society to achieve some higher end and that such action would be incompatible with human freedom. This should all resonate with Conservatives who are suspicious of grand plans, radical change and of democracy as an absolute value – it should resonate with liberals in the Liberal Democrat party too.

Hayek’s thought is influenced by traditions in many countries. Like Mrs. Thatcher, however, he believed that much went wrong after the French revolution. Perhaps my favourite sentences in the IEA’s new monograph are: “The contributions of England, America and Germany are presented as parts of a single process of growth or as ‘stages in a continuous development’. Each nation added something distinctive during its shining moment. There is no chapter on France…”

Sadly the author of Hayek’s The Constitution of Liberty: An Account of Its Argument died just before its publication. He has left a fine legacy. As the coalition considers economic reform, how to facilitate the development of the Big Society and how to pursue constitutional reform, David Cameron should bang our new book on the cabinet table and tell his ministers to read it.

More information about The Constitution of Liberty: An Account of Its Argument is available on the IEA website.

Comments

Philip Booth: What ministers should learn from Hayek's The Constitution of Liberty

Professor Philip Booth is Editorial and Programme Director at the Institute of Economic Affairs, which is today releasing a new edition of Hayek’s Constitution of Liberty.

To the socialists of all parties (to whom F. A. Hayek dedicated The Road to Serfdom), The Constitution of Liberty, is anathema. Hayek, they believe, stands for an atomised society full of selfish individuals all looking after their own interests. But nobody who has read the original texts could possibly represent him this way.

One person who understood this was Margaret Thatcher. Once during a party policy meeting a speaker started to argue that the Conservative Party should adopt a pragmatic middle way. According to John Ranelagh in Thatcher’s People, “Before he had finished speaking...the new Party Leader reached into her briefcase and took out a book. It was Friedrich von Hayek’s The Constitution of Liberty. Interrupting, she held the book up for all of us to see. ‘This,’ she said sternly, ‘is what we believe,’ and banged Hayek down on the table.”

It may have been what Mrs. Thatcher believed, but she was in a minority amongst politicians and so there remains much to be done in terms of rolling back the state. Ministers are busy people, of course. But, for the new breed of Whig-minded Conservatives – or, for that matter, Whig-minded Liberals - within the coalition there is now no excuse for not understanding Hayek. The IEA has just published a summarised account of the arguments Hayek made in The Constitution of Liberty: the volume fits neatly into a minister’s red box and can be read in a few hours.

So what is The Constitution of Liberty about? In essence it explains how a complex cooperative, great society can come about in an environment of freedom under the rule of law. It emphasises the importance of tradition and of limiting government discretion. Whilst Hayek might not have been a Conservative, The Constitution of Liberty, to some extent, sits at the juxtaposition of a certain strand of Conservatism and liberalism. Without question it is more “Big Society” than “Big State”. However, the work demonstrates why the Big Society should evolve spontaneously and not be created and cajoled by the government – a lesson not understood by the coalition.